Bank of Canada's governing council agreed odds of another interest rate hike have fallen

The Bank of Canada's governing council agreed the odds of another rate hike have decreased during its discussions ahead of the interest rate decision earlier this month.

The central bank released its summary of deliberations for its Dec. 6 interest rate decision Tuesday, revealing the governing council felt more optimistic about the country's inflation outlook.

Recent data showed the economic slowdown is being driven by a pullback in spending, which the central bank is relying on to bring inflation down.

The central bank opted to hold its key interest rate steady earlier this month for a third time in a row, as forecasters widely expect its next move will be to cut interest rates sometime next year.

But the Bank of Canada hasn't ruled out the possibility of another rate increase yet, noting in the summary that it may be necessary to raise rates again to further quash inflation.

Statistics Canada released its November consumer price index report on Tuesday, which showed inflation did not slow down last month, holding steady at 3.1 per cent.

WATCH | Bank of Canada governor Tiff Macklem delivers year-end speech:

2% inflation target in sight but 'not there yet,' BoC governor says

12 months ago

Duration 0:38

In his final speech of the year, Bank of Canada governor Tiff Macklem touched on what still needs to happen before the central bank considers cutting rates. 'We still need to see more downward momentum in core inflation,' he said.